FSD 56 - FS Incentive Allowances/FS Premium

The employee grieved the employer's decision to deny taking into account his years of service outside Canada as an employee under the Interchange Canada program (from the third quarter of 1996 to July 31, 2001) in the calculation of the foreign service premium for his current assignment, which started in August 2001. The grievor requested that the calculation of points used to establish the foreign service premium for his current assignment include the time spent in a foreign country under the Interchange Canada program. Additionally, the grievor requested that the adjustments be retroactive as of August 2001.

The grievor accepted a foreign assignment with a host organization through the Interchange Canada Program. The assignment started on November 4, 1996, and ended on July 31, 2001.

In a letter dated October 29, 1996, the union representative agreed to waive the grievor's application of the FSD during this foreign assignment. The grievor indicated full satisfaction with the benefits negotiated with the host organization.

In August 2001, the grievor accepted another assignment with a government agency. In September 2001, the grievor requested that the employer use the months worked in the host organization to count towards his foreign service premium calculation. The employer rejected the request.

Although the grievor pursued the matter at higher levels in the government agency, on April 14, 2003, the employer confirmed its rejection of the grievor's request. On April 25, 2003, the grievor filed a grievance.

Bargaining Agent Presentation on Timeliness Issue

The Bargaining Agent representative indicated that he did not agree with the objection raised by the employer with regard to the fact that the grievance was considered untimely.

On September 20, 2001, the grievor received a response from the employer on the eligibility of the months spent abroad working for a host organization in the calculation of the foreign service premiums paid during the current assignment. The employer's response quoted a Treasury Board source that led the grievor to conclude that situation had been not only misunderstood but misinterpreted. The grievor was not claiming retroactive payment of the premiums waived.

Dissatisfied with the response received, the grievor pursued the matter at higher levels in the government agency which brought the matter to the attention of the appropriate authorities as circumstances were discussed during a team meeting. A memo dated April 25, 2002 was prepared and presented to the government agency's officials, making reference to the grievor's situation, without naming him, and that of other individuals with the same concerns. The grievor waited several months but received no response to the memo.

In December 2002, the grievor once again raised the matter with a human resources manager in the government agency during a meeting in the field. This individual approached the appropriate authorities, which led to an exchange of emails. However, on April 14, 2003, this individual reiterated the same interpretation of FSD 56 that the employer had previous indicated in September 2001.

Until that point, the grievor had hoped that a clearer understanding of the situation would lead the employer to reconsider. Thus, in April 2003, the grievor realized that an impasse had been met and that all internal avenues had been exhausted

His union representative suggested that a grievance be filed as soon as possible which was April 25, 2003, barely 7 working days after receiving the employer's response.

The Bargaining Agent representative maintains that there is no doubt that the grievance was timely and, therefore, gives the grievor an opportunity to be heard and to clarify this fundamental issue.

Bargaining Agent Presentation on the Merits of the Case

The Bargaining Agent representative focused on clarifying the scope and nature of the grievance. Contrary to what the employer had indicated, the grievor was not asking for retroactive payment of the foreign service premium for the years served abroad, only that the months worked for the government agency count towards the premiums for current and subsequent assignments.

The issue that must be addressed is whether or not the time that a government employee spends working abroad should count towards the calculation of the foreign service premium in subsequent assignments, when the employee would have been entitled to that premium but decided to waive it.

In 1996, the grievor participated in a foreign assignment under the Interchange Canada Program, a program administered by the Public Service Commission to help diversify the experience and skills of federal government employees. At the time, the grievor was an employee of the government agency working for a host organization. This initiative was undertaken with the support of the employer, the government agency and the cooperation of the host organization.

The Bargaining Agent representative wished to clarify a few facts concerning the grievor's assignment:

• the grievor was the only Canadian public servant on this project. One of the grievor's colleagues was a Canadian consultant. The private firm hired 24 foreign consultants for one-year assignments;
• all employees of the host agency working on the project were entitled to the same administrative standards; this approach ensured internal consistency on the project.
• if the grievor had received FSD payments, this would have created distortions in the compensation payments to employees, administrative complications and additional costs for the host organization managing the project (the rules followed by the host organization and its benefits were different from those of the government agency, i.e. those set out in the Foreign Service Directives);
• Annex A of the agreement signed on November 1, 1996, under the Interchange Canada Program states that the host organization's standards will prevail and sets out its role in the approval of costs;
• thus, it was more simple, logical and effective to make the premiums and benefits consistent for all individuals working on the project.

The Bargaining Agent representative drew attention to one of the principles in the introduction to the FSD, that of incentive-inducement:

"The principle of incentive-inducement recognizes that the employer must provide certain additional emoluments both to attract employees to serve an occasional assignment outside Canada and to recruit and retain employees in a career foreign service."

This principle is reiterated in the introduction to FSD 56 – Foreign Service Incentive Allowances:

The Bargaining Agent representative pointed out that the grievor received compensation and benefits from the government agency and was a public servant assigned abroad as defined in FSD 3.01(b). The fact that during the entire assignment, which lasted almost five years, the grievor was not on leave without pay but remained a public servant paid by the government agency. This status as an employee is consistent with the Interchange Canada Program guidelines:

The Bargaining Agent representative added that the preamble to these guidelines:

The Bargaining Agent representative maintains that the grievor was entitled to the Foreign Service Incentive Allowance. The grievor chose to waive his rights, as is entitled under the Interchange Canada Program guidelines:

and with the approval of the union representative, precisely as provided by FSD 56.04(b):

The Bargaining Agent representative explained that by waiving the entitled monies if the FSD had applied, the grievor did not waive rights to count years of service towards the foreign service premium for subsequent assignments.

The Bargaining Agent representative believes that by waiving the application of the FSD, the grievor enabled the government agency, hence the Government of Canada, thanks to the host organization, to achieve substantial savings between November 1996, and July 2001. It would not be fair to penalize the grievor for waiving entitlement to the FSD, which was in the best interests of the employer and the Government of Canada.

The Bargaining Agent representative indicated that a quick calculation would set the difference at $4,000 between the foreign service premium received by the grievor and the amount the latter would have been entitled to if the months worked for the government agency between 1996 and 2001 had been taken into account. These years count towards the calculation of superannuation, annual leave and other services attached to the grievor's status as a public servant.

The Bargaining Agent representative requested that the Committee review the grievor's specific circumstances carefully and respect the principles of the FSD incentive allowance, as well as the principles of natural justice. For all these reasons, this grievance should be allowed and the requested corrective measures granted.

Departmental Presentation on Timeliness Issue

The Departmental representative indicated that the grievor discovered on September 20, 2001, that the assignment to the private firm through the Interchange Canada Program would not count towards the calculation of foreign service premium for subsequent assignments. The employer had clearly informed the grievor by e-mail that: "There is no way an employee can be credited for FSP points which he/she did not receive."

There was no suggestion in this e-mail that the response to the request was an interim one and that the grievor should expect any other response. Hence, the grievor was perfectly aware of the circumstances leading to the grievance as early as September 2001, and that the grievor filed a grievance 19 months later, on April 25, 2003.

The Departmental representative believes that the grievor used an encounter with one of the human resources managers from the government agency during a meeting in the field in December 2002, to raise this matter once again. This manager brought it to the attention of the appropriate authorities, who subsequently confirmed the employer's decision provided in September 2001. This situation did not suggest that the grievor would receive a new deadline.

The reasons provided by the grievor are not sufficient to show that the grievance was filed within the prescribed timeframes. Therefore, the Departmental representative concluded that the grievance is untimely and should be dismissed.

Departmental Presentation on the Merits of the Case

The grievor took part in the Interchange Canada Program in order to take an assignment with a host organization. The original agreement was for a two-year assignment, starting on November 4, 1996, and ending on November 4, 1998. However, the assignment was extended twice, and ended on July 31, 2001. During this period, the grievor took leave with pay while working for the host organization. Under the Interchange Canada Program, the host organization reimburses the government agency for the grievor's compensation and benefits. Hence, the grievor received salary from the government agency but worked for the host organization, which, at the end of the day, paid the grievor's salary.

The Departmental representative noted that the original agreement, which set out the terms and conditions of the grievor's assignment through Interchange Canada, listed the benefits that would be paid by the host organization to the grievor.

The Departmental representative indicated that FSD 3.01(d)(iv) states that when a public servant takes paid leave in order to be free to take an assignment with a host organization operating outside Canada and this organization does not provide any financial assistance or related benefit, the FSD may apply. But in this case the grievor received financial assistance and related benefits from the host organization. Thus, the FSD, including FSD 56 and all related benefits, do not apply to the grievor's assignment.

The Departmental representative noted that the grievor agreed that the FSD did not apply to this assignment. In a letter dated October 29, 1996, and addressed to the union representative, the grievor indicated that the applicability of the FSD had been examined and, after careful consideration, it was agreed that the FSD would not apply to the assignment since the grievor was fully satisfied with the benefits negotiated with the host organization. The Departmental representative indicated that the grievor's union representative also agreed by signing the letter in question indicating approval of the fact that the FSD would not apply to this assignment. Moreover, the Departmental representative noted that the third paragraph of the letter clearly stated that the grievor was aware that an employee could not apply for both the benefits negotiated with the host organization and the benefits outlined in the FSD. Thus, the Departmental representative concluded that the grievor was fully aware of the facts when the benefits provided by the private firm were accepted.

The Departmental representative indicated that according to FSD 56.04(b), for the purpose of calculating points under this directive, an employee shall be deemed to have earned one point per service abroad where there is an entitlement of foreign service premium for ten compensation days in a calendar month. But in this case, the grievor was not entitled to the foreign service premium during assignment with the private firm since, as previously indicated, the FSD did not apply to this assignment. Consequently, the grievor would not have received any points for the months spent working abroad for the host organization. The Departmental representative pointed out that the grievor had not asked to have the foreign service premium paid, only to receive the points.

The Departmental representative also indicated that the Interchange Canada Program directives clearly state that the FSD does not automatically apply to the foreign assignments of federal public servants. The mere fact of participating in the Interchange Canada Program does not make the grievor eligible for the FSD which, of course, includes the points calculated under FSD 56.

The Departmental representative concluded by summarizing the facts as follows:

• Although the grievor had clearly been informed of the circumstances leading to the grievance on September 20, 2001, the grievance was filed on April 25, 2003, thereby an untimely grievance had been had been filed;
• The grievor received financial assistance and other related benefits from the host organization, and that the assignment under which the grievor received paid leave did not entitle the grievor to the FSD (pursuant to FSD 3), which naturally includes FSD 56 and all the benefits included therein; and
• The exchange of correspondence between the grievor and the union representative revealed that they were both in fully agreement with the fact that the FSD did not apply to the grievor's assignment with the host organization.

The Departmental representative deems it impossible to conclude that the grievor was entitled to the foreign service premium and the foreign service points for an assignment with the host organization under the Interchange Canada Program. The grievance should be dismissed and, consequently, the corrective measures requested should not be allowed.

The Executive Committee considered the Foreign Service Directives Committee majority report and concluded that it could not come to agreement on whether the grievor had been treated within the intent of the Directive. Therefore, the Committee reached an impasse.